Looking for Your Dream Home? 7 Things You Should Know
No matter who you are, you’ve probably thought about being a homeowner at some point in your life. Buying a home is among the top five most common life goals for American adults, so it stands to reason that finding the dream home you’ve always wanted is on your bucket list. Now the question is how to get it.
There’s plenty of advice out there on becoming a homeowner, but you’re probably looking for simple guidelines. Lucky for you, you’re about to get seven pieces of advice that most people wish they had known before they started shopping the housing market. So here’s some food for your noggin:
1. Know what you need and what you can live without. It’s time to ask yourself the tough questions. Make that giant list of things you want in a dream house then divide that list into two columns: things that would be nice to have and things that you won’t sacrifice. This is also the time to consider your long-term goals. Are you planning to stay at your job for many years to come? A short commute might be the most important factor. Are you planning to expand your family? Buy a big enough house that you can grow.
2. Get preapproved for a loan—not prequalified. What’s the difference? In a nutshell, preapproval is the strongest stamp of approval a lender can give you. Once you’re preapproved you’ll know exactly how much you can spend on your future home, and having a preapproval letter to show sellers is the next best thing to making an all-cash offer. So don’t mess around with prequalification. Shop around for a good lender and get preapproved right off the bat so you can have that letter handy.
3. Get to know the areas where you want to look. Of all the factors that go into a house, location is the one you can never change. So make location a top priority and get to know the neighborhoods where you’re shopping. Lots of homebuyers rely on their real estate agents to find the right neighborhoods, but the secret to finding the best fit for you is to be involved in the process. Do lots of research on your potential locations, and even if you don’t have kids, make sure you’re buying in top-notch school districts. This is a huge factor in your home’s value.
4. Houses go fast, so be ready pounce. In the current housing market, homes can have offers within 24 hours. You need to be prepared to keep close tabs on the market and not rely solely on your realtor to see new listings since your agent has multiple clients to think about. Top search sites like realtor.com update every 15 minutes, so hit the refresh button as often as you can if you’re working at a desk all day. You can also set up mobile alerts on your smartphone so you can move fast on any new opportunities.
5. Watch out for deal breakers. Although you need to move fast on homes you want, don’t move so fast that major issues escape your notice. Ask lots of questions, work together with your real estate agent, and be on the lookout for big deal breakers. Here are six you should definitely keep in mind: a roof that needs to be replaced, a home in a high-risk flooding zone, faulty sewer lines or plumbing, an electrical system that needs updates, and restrictive local zoning rules that might prevent you from doing home improvements. Always beware of major fixer-uppers.
6. Know what makes a good offer. This is a big one. Lots of buyers make the mistake of low-balling their offers, but in the long run this is actually a poor strategy. Shop in the price range you can actually afford and always make an initial offer that’s close to the listing price. If you make an offer you’re positive the seller won’t take, you’re wasting valuable time. And more likely than not you’re going to offend the seller and lose the house. It also helps to have a clean offer that’s easy to understand and not bogged down with lots of stipulations and requests. Talk to your real estate agent about negotiations that can happen after the offer is accepted.
7. Be different from other homebuyers. The details of buying and selling homes often happen between two real estate agents, but at the end of the day, the seller is the person who will accept or reject your offer. So take the time to contact the person selling your dream home. Let them know how excited you are, why you’re buying a home, and what the two of you have in common. Most people have emotional attachments to their homes and want to sell to someone who will appreciate the house and take care of it. Go the extra mile of showing your passion for someone’s home and your chances of getting it will skyrocket.